New Cars, Used Cars, Advice On Safety, Credit and Debt, Car Finance, Car Leasing, Car Buying.
First of all what is a Blog? If you have never come across the expression it can be explained as follows:
A blog (short for weblog) is a personal online journal that is frequently updated and intended for general public consumption. Each entry is called a post and is there to provide help and advice but we take no responsibility for the accuracy of information provided and recommend that you take legal, tax, accounting and safety advice from experts in the relevant field.
I will be posting below information on a regular basis and would like to include anything that you might wish to add or comment upon so please write to me by clicking on the contact us button.
One of the problems that I continually face when deciding with clients which would be the most appropriate finance for their needs is the belief that their car will be worth considerably more when they dispose of it in two or three years time than it actually will be. Whilst some new £15,000 cars on very low mileage may be worth £10,000 it is more likely to be worth from £6,000 to £8,000. If you take for example two similarly priced cars from the same manufacturer we can see the difference as projected by What Car Magazine. Firstly take a Renault Meganne Coupe Convertible 1.6VVT Extreme (£17,810) and compare it to a Renault Laguna 2.016v Dynamique Navigation 5Dr (£17,875). A straw pole revealed that people believed that both cars would depreciate similarly with the Meganne faring slightly better. Estimates based on three years and average mileage of 12,000 miles per annum were between £10,000 and £12,000 with the Meganne estimated to be worth about £1,000 more than the Laguna. The projections estimated by What Car based on trade in values put the Meganne at £8,195 (46%) but the Laguna was estimated to be worth a dismal £4,826 (27%). That's right, under £5,000. The problem is that when leasing figures are calculated and compared to outright purchase or HP the huge miscalculation of future value throws the comparisons completely out of kilter and can present the client with what appears to be a difficult choice as the purchase may look cheaper than the lease but in truth the lease could save a fortune without the hassle or huge disappointent of disposing of the car when it's time to change it. So if you have always bought and you think you get a better deal think again and buy a copy of What Car!
- Ever lost your car? Read this it will make you feel better!
If like me you have ever lost your car for an hour or so in a multi story carpark this story will help you to feel less daft! Eric King was reunited with his car — seven months after forgetting where he parked it. Absent-minded Eric, 57, left his black X-reg Ford Focus in a space in Bury St Edmunds, Suffolk so he could walk into the town centre. But when he had finished his sightseeing trip he couldn’t remember the name of the residential road he had parked the car in or where it was. Eric searched for the £3,000 motor for four hours before catching a coach back to his home over 60 miles away in Milton Keynes, Bucks. He reported the Focus missing to police but could not make an insurance claim as it had not been stolen. He returned to Bury St Edmunds ten times to look for his motor, often booking himself into bed and breakfasts overnight — and lost two stone tramping the streets in his quest (great diet to challenge Atkins - lose your car and lose weight). He finally got the car back after it was reported abandoned where he had left it — in Blackbird Drive on the Moreton Hall estate. Two neighbours both assumed the car left outside their homes belonged to the other, eventually alerting the local council when they realised neither was the owner. St Edmundsbury Council officials notified a delighted Eric, who caught a coach back to the town and was taken to his car. Its road tax had expired but the car was undamaged apart from a flat battery — and started first time with jump leads. Planes enthusiast Eric had only stopped in the town on the way back from a show at nearby Rougham Airfield. He said: “I had almost given up hope of finding the car again but I knew it must be there somewhere. In future I’ll make sure I park in places I know I can find.” What a doughnut!
- Company car or cash for car?
If you are about to provide drivers with cash for cars or you are an employee who is being offered a cash alternative to your company car think carefully before making the decision. In a surprise move just before Christmas Her Majesty's Customs and Excise announced an earlier than expected review of employee car ownership schemes as a result of findings that suggested (as I have done on many occasions) that when you provide employees with a relatively free hand to choose their own car after providing a cash alternative to the company car they choose either older or bigger cars increasing their per capita CO2 emissions and thereby harming the environment more than company car drivers. The findings suggest that cash for car drivers emit on average 20g/km more CO2 than average company cars. The industry has complained and questioned the figures but they are unlikely to be listened to by the Revenue. The review is being rushed through in time for the Budget and that is when we may see some major changes to the ECOS (employee car ownership schemes) as well as the generous tax and NI free allowance of 40 pence per mile for the first 10,000 company miles per annum, something that makes cash for cars very beneficial for employees. The likelihood is that the changes may well take immediate effect which could land employees with a huge tax increase suddenly making company cars much more attractive so my recommendation is to either stick with company cars wherever possible or try to hold back until we have more of an idea as to what the Revenue and the Government's intentions are. Bought my book yet? If not and you want to learn more about personal vs business funding of cars used for business then you should buy a copy. It even explains how you can finance a car through the business and still not pay benefit in kind tax!
- Avoid the insurance scam that is costing the insurance industry £1.5 billion annually and adding 5% to you premiums
Warnings have been issued about the upsurge in accident scam insurance fraud. It is believed that this scam is costing the insurance industry more than £1.5 billion adding 5% to policy holders premiums. The scam is quite simple. The culprits either pull out in front of you at a junction and brake hard forcing you into the back of their car or on a perfectly clear road brake hard forcing an accident. Sometimes the fraudsters will disconnect brake lights or even run the wires through a switch so that after an accident they can show that the lights are working even though they weren't when you hit them. Royal and Sun Alliance have issued the following guidelines if you have an accident that you believe has been staged:
If you suspect that you have been involved in a staged accident, don't say anything other than 'it is a matter for our insurance companies'
If anyone is injured call the police. My view is that if you feel that you are a victim of a scam you need a reason to call the police so the slightest of injuries that could lead to something more serious is reason enough for police attendance.
Take as many pictures as possible of the accident, including the driver, passengers, vehicle and damage. Don't forget to download mobile phone pictures as soon as you can to avoid accidentally deleting them. If you don't have a mobile phone capable of taking photos you should carry a disposable camera at all times.
The identity of the driver is crucial so take a good description.
Establish how many passengers are in the other car and take a good description of them also.
Try to find an independent witness for the accident but be wary of any witnesses quick to offer their services as they may be corrupt.
Take note of any other cars involved, including damage and registration numbers.
Be wary of any companies that contact you quickly, offering to repair your car, unless they are through your insurance company.
If you suspect the accident was intentional, inform your insurance company at the earliest opportunity.
If you know of anyone involved in staging accidents call the IFB Cheatline on 0800 328 2550.
Like to be kept up to date with this sort of information? Then you can read it on here from time to time or buy our book 'An Insider Guide To Car Finance' and get the information for free in the eBook 'Hints Tips & Safety' sent to youwith the main book.
- Changes to the law relating to the use of mobile phones (including hands free).
The law regarding the use of mobile phones whilst driving is about to tighten. From 27th February 2007 if you are caught using a mobile phone whilst driving the fixed penalty has increased from £30 to £60 and you will now receive 3 points on your licence up from no points at all. The hardening of penalties has come about as a result of the number of people still using a mobile phone whilst driving. Nearly 74,000 fixed penalty notices were issued in 2004 for illegal use of a mobile phone whilst driving according to the Home Office. Douglas Alexander (apparently he is the Transport Secretary - and I thought it was Alastaire Darling - get up to date Graham!) said 'Research shows that talking on a mobile phone while driving affects your concentration and ability to react to dangerous situations. It's quite simple - it's impossible to do two things at once and do them well (note - phew! Got a few lady readers who may want to challenge him on that one!). That is why in December 2003 we introduced new laws preventing motorists from driving whilst using a hand held mobile'. Whilst there has been a great deal of support for the move, 92 % say they agree with it, 21 % admit to breaking it. The new law is introduced within the Road Safety Act which introduces the same penalties for not having proper control of a vehicle and this is a little more worrying for drivers who think they are OK by using a hands free phone as it applies where a driver is distracted by using a hands free mobile phone. And don't enter into a war of words with the police officer if you are stopped as he doesn't have to issue a fixed penalty. He can (or you can) choose to go to court whereby you could face a maximum fine of £1,000 or £2,500 if you are a driver of a van, lorry, bus or coach. If you employ staff who may use their mobile phone whilst driving on business make sure that you include within your contract of employment a strong statement telling employees not you use a mobile phone whilst driving or they will face disciplinary action that could result in termination of their employment. This will go someway to covering you in the event that a driver has a major accident whilst driving on company business. This is the type of information that we have included in our Hints Tips & Safety book that we give away absolutely free when you buy our main book, so if you haven't bought it already buy it now and save yourself a fortune on finance and avoid fines!
I feel very strongly about the issues that surround debt and the way that finance companies now handle arrears and other forms of client debt. One young lad that I know was made redundant and struggled making repayments on his first car. He wrote to the finance company concerned and offered a reduced payment until he was back in employment sending them a token payment in the letter. He was then bombarded with telephone calls to his mobile phone and parent's home phone but no letter as requested. He was greatly distressed and finally answered the phone to be confronted by a forceful collection agent who, by the end of the conversation, had got him to part with his last £50 in his bank account by giving details of his debit card. He had no money left to pay for petrol or fares to enable him to get to interviews. This is a disgrace! So I would offer the following advice passed on by an 'interested party' along with my own observations:
First do as this lad did and make sure that you write to the finance company/bank if you find yourself having debt problems and offer a token amount to show your willingness to make payments. You will receive no sympathy if you make no contact at all, the assumption will be that you have no intention of making any further payments. You can telephone the company concerned but I prefer to keep things in writing then you have proof as to what has been agreed. Also, if you send a cheque and it is cashed they cannot later deny that they have received your letter (often an excuse given for phoning). If you continue to receive calls you can do the following:
Send theFinance Company a letter stating that you are only prepared to deal with the matter in writing, and they must cease phoning you or action will be taken under the Wireless Telegraphy Act 1949 and have them disconnected.
If they continue to call you say the following:-
I am now taping the rest of this conversation: (Pause as though you are pressing the record button) and I am putting you on notice, that I intend reporting you to the Office of Fair Trading, under Section 40 of The Administration of Justice Act 1970, for Harassment. Furthermore, I will from this point on, only communicate with you in writing and if I receive just one more telephone call from you or your organisation, I will see that you face criminal proceedings under Section 2 of The Protection from Harassment Act 1997 and before you say anything further, you may be interested to know that your consumer credit license will not protect you from prosecution. Are we now absolutely clear on the matter.
Hang up.
If you can deal with the problem with the finance company it will save a lot of unnecessary hassle dealing with debt collection agencies and if you can make a nominal payment whilst you sort out your problems it will avoid a court case and possible bad credit. If you have a problem that has resulted from a catastrophy that should not make you a bad credit risk there is a way of recording information on your credit file for funders to see but to find out what you can do you will have to buy my book! Well what did you expect - I have to pay my bills also! Haha!
|
